PERFORMANCE: The new head of Imperial College Healthcare Trust has used an HSJ interview to promise “evolution” at the leading teaching hospital.

Mark Davies took over as chief executive in May after his predecessor Stephen Smith announced he was leaving to to take up a role with Nanyang University in Singapore.

Imperial is one of the country’s five academic health science centres, which entail partnerships between medical schools and NHS trusts, creating combined research centres and teaching hospitals.

The trust ran into a perfect financial storm at the end of 2010-11, having to set a 15 per cent savings plan to cope with tariff reductions and dis-investment from commissioners. Former health minister Lord Darzi, a surgeon at the trust, has been called in to advise on the AHSC’s future direction.

Uniquely among England’s five AHSCs, Professor Smith was chief executive of both Imperial College’s medical school and the NHS trust.

A trust strategy document submitted to the Department of Health before he resigned said the problems faced by AHSCs like Imperial including reductions in specialist tariffs and training budgets, were “a challenge for the country” and risked “damage to its wealth creating potential”.

“The ability of the UK to compete in the biomedical and biotechnical industries is dependent on the success of research-active higher education institutions and their interaction with the NHS, epitomised by the AHSCs,” it said.

Mr Davies says: “The previous model centred around the unique role that Professor Smith had. Stephen Smith’s leaving for Singapore has opened the opportunity for us and the college to think about how we might operate in the future. I think that [opportunity] is excellent.”

He says the intention was to “build on the successes of the past and learn from others, this is an evolution”.

Speaking to HSJ about whether the balance between running a research facility and a hospital trust wouldbe re-set at ICHT, Mr Davies stressed the importance of continuing the clinical leadership developed by Professor Smith, but that he and the new top team are firmly from an NHS management background.

He came to the role from the provider development job at NHS London and appointees Kevin Jarrold and Bill Shields, as chief information officer and finance director respectively, both hail from SHAs. An advert for a director of strategy will appear in HSJ in September.

Asked if the trust is viable in its current form, Mr Davies simply replied “yes”. He denied that a McKinsey-led review of services across Imperial and neighbouring West Middlesex University Hospital is a prelude an Imperial take-over of the smaller trust.

“It’s not expansion - the world is contracting, not expanding.” he said. “It’s about doing what we do now on different locations, but also in different ways.”

He added the consultancy’s brief was to examine “the optimum set and pattern of services across those five sites that improves the quality of care and is financially viable”.

Given that the north west London cluster is paying for the review and intends to take £270m out of the acute sector by 2014-15, financial viability must be a high priority.

In December the cluster proposed taking £137m out of the £924m-turnover Imperial and £42m out of £149m-turnover West Middlesex over this period.

Imperial’s planned integrated care organisation could recapture some of this money by providing community services, but it would have to compete with others to do so.

Another review is working towards an estates strategy across the trust’s four expensive, central London sites. Options for a rationalisation - that sources elsewhere in the London health economy say should have happened earlier - could include moving part of the Royal Brompton and Harefield’s facilities to an Imperial site.

With such decisions not having been made previously, Imperial is seeking £70m savings this year and asking for £30m in “transitional support” from the cluster and the SHA.

Mr Davies said this will mean a bid for foundation trust status cannot go ahead until 2013-14 at the earliest, after the trust has had a year of breaking even. “It’s a way off,” he admits.

His contract runs two years from May 2011 and he says in that time he wants to attract the “very best” management talent to Imperial, “to make this a place where people come as the pinnacle of their career or a major stepping stone”.